LAS VEGAS -- The State of Nevada Foreclosure Mediation Program is running out of money. Lawmakers must now decide whether to keep the program created to help families stay in their homes.
The legislature established foreclosure mediation in 2009 to force lenders to sit down with homeowners to seek alternatives to foreclosure. Since then, there have been more than 16,000 mediations with about 40 percent of them resulting in a deal.
Lately, the number of participants has dropped and the program's funding source has nearly dried up. Foreclosure mediation is funded by a fee charged for filing foreclosure papers. During the last 10 months, the number of those filed has dropped from an average of 5,000 to 6,000 a month. In June 2012, that number dropped to 800.
Administrators say the program cannot survive without additional funding.
"I do think there's going to continue to be a demand for this and I do look forward to working with you next session to resolve the budgetary side of this so that we can continue to provide this service as needed," said Nevada Assemblyman Marcus Conklin.
He studies real estate and predicts the number of foreclosure filings will increase in the coming months. The filings dropped dramatically last year when a new law took effect requiring lenders to prove they have the legal right to take someone's house.
Lawmakers did not take action Thursday. The program has enough money to operate on reserves until the legislature convenes next year.